[amp_mcq option1=”e-bar” option2=”r-bar” option3=”r-hat” option4=”e-hat” correct=”option1″]
The correct answer is: A. e-bar
An expected rate of return is denoted by $\bar{e}$, which is read as “e-bar”. It is the average of the possible returns of an investment, weighted by their probabilities. For example, if an investment has a 50% chance of returning 10% and a 50% chance of returning 20%, then the expected rate of return is $\bar{e} = (0.5 \times 10\%) + (0.5 \times 20\%) = 15\%$.
The other options are incorrect. Option B, $r-bar$, is the symbol for the arithmetic mean of a set of numbers. Option C, $r-hat$, is the symbol for the sample mean of a set of numbers. Option D, $e-hat$, is not a commonly used symbol.